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Top 5 Reasons Your Doctor Has a Side Hustle

Leif Dahleen, MD

Post By Leif Dahleen, MD

May 27, 2021

Types of Physician Side Hustles

The different types of physician side hustles run the gamut from closely related to medicine to as far away as one could get.

Your doctor may simply be moonlighting in their own specialty, working extra nights and weekends or covering others’ vacation time by using their own vacation days working as a locum tenens physician. They may be doing clinical work outside of their specialty but well within their lane as a physician by performing insurance physicals or sports physicals. Some physicians leverage their expertise by doing non-clinical work as expert witnesses or case reviews. There are doctors helping their colleagues better understand issues in personal matters like finances, career matters and burnout issues. Whatever the side hustle, there are a handful of reasons you may very well have more than one job.

#1: Doctors are Deep in Debt

The average indebted medical student, which is about 71% of them according to the latest AAMC survey, has around $200,000 in student loan debt when finishing medical school. The balance typically grows during a 3 to 7-plus year stretch of residency and fellowship training before one can start earning a physicians’ salary. A doctor that had no family help and attended private or out-of-state schools for their undergraduate and medical studies can easily rack up $500,000 or more in student loan debt.

Those who work a side hustle for this reason will typically find one that pays well right off the bat and requires little additional knowledge or training. Think moonlighting in one’s own field and locum tenens work.

#2 Personal Fulfillment

Yes, many physicians have felt the calling to heal from an early age, but quite a few that came to that choice in a more roundabout way. “I got excellent grades, liked science, and medicine seemed like a natural fit. Plus, my parents really wanted me to be a doctor.” I’ve heard many variations on this theme.

Perhaps what you really wanted to do in life didn’t translate well to an actual career. That’s where the side hustle can come into play.

The doctor job pays the bills and then some and can also provide the seed money for any number of unrelated pursuits.

The closer you are to financial independence — and can conceivably be done saving for retirement — the more freedom you have to do whatever it is outside of medicine that feeds your soul.

#3 A Goal-Driven Nature

Excel in high school. Attend a well-regarded college or university, preferably with a merit scholarship. Earn a strong GPA and ace the standardized tests. Beat the odds and be accepted into med school. The fun is just beginning.

Drink from the firehose of information that comprises the first two years of medical school. Impress your attending physicians with your knowledge, confidence, and wit. Receive outstanding letters of recommendation that will ultimately help you land a prized residency spot in your specialty of choice.

Similar fun awaits you in residency and fellowship, where you’ll often be working 80 hours a week. Master your craft and please the right people, and you’ll be awarded with a great job — a real doctor job — when you finish your training.

And then… you work.

Unless you stay on in academic medicine at an ivory tower institution, you soon run out of hoops to jump through. The only milestones you may have left are when your employer acknowledges that you’ve been with them for five years, and then ten years… fifteen years, and you feel a certain void that’s hard to pin down.

After a lifetime of people-pleasing and achievement, you want to accomplish something more. That’s where a side hustle can be invaluable. Starting something completely novel — often from scratch — can give your physician a whole new set of goals to set and pinnacles to reach. That may be exactly what your goal-oriented doctor needs.

#4 Another Retirement Account

Physicians get a late start on retirement savings and often celebrate becoming “worthless,” that is escaping a negative net worth to finally break even, at some point in their thirties.

A side hustle can allow an employed physician to open another type of retirement account, such as a solo 401(k) or SEP IRA, with earnings from the extra income. A lucrative side hustle could allow a doctor to put as much as $57,000 into an individual 401(k) or SEP IRA in 2020. Tax-deferred contributions of that magnitude can be powerful in both boosting retirement savings and reducing taxes for the high-income professional.

An additional advantage of having an individual 401(k), as long as the plan accepts rollovers, is that it can be a place to consolidate any “old” accounts like a 401(k) or 403(b) from a previous employer, or a traditional or SEP IRA.

Eliminating any IRA money in your name opens up the possibility of making $6,000 (or $7,000 if age 50 or over) annual backdoor Roth contributions. High earners are unable to contribute to a Roth IRA directly, but there is a two-step workaround, and that’s one more retirement account to help these late starters play catch-up.

Doctors that pursue a side hustle primarily to open a new retirement account and perhaps to pave the way for backdoor Roth contributions may do something small and simple for their business. Filling out paid medical surveys in their spare time is a great example.

#5 A Transition to an Encore Career

An “encore career” is a vocation finale after one’s primary career has ended. Given the amount of time and energy that goes into becoming a physician, the practice of medicine will be the primary career for the vast majority of medical school graduates.

Later in their careers, some doctors may decide to scratch the itch to try their hand at another profession entirely.

If it works out, great! You may choose to wind your medical practice down while devoting increasingly more of your time to this new endeavor. If the idea flops or you find out it’s not for you, it’s no hardship. Your primary gig has already given you years of fulfillment and financial security.

Leif Dahleen, MD retired from medicine at the age of 43, having achieved financial independence several years earlier. He started Physician on FIRE to enlighten, educate, and entertain other high-income professionals while discussing money matters of all sorts. He is happily married with two children. They call northern Michigan their home base and look forward to returning to more family travel as the world begins to open up. 

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